Greenland clears way for uranium study

13 September 2010

The Greenland government, increasing its independence from Denmark, has relaxed restrictions on uranium deposits. Australian-based Greenland Minerals and Energy now has a clear path to assess its Kvanefjeld rare earth elements, uranium and zinc deposit.

An amendment has been made by the Greenland government to the standard terms for exploration licences under the country's Mineral Resources Act of 2009 that allows for, upon application approval, the inclusion of radioactive elements as exploitable minerals for the purpose of thorough evaluation and reporting.

Drilling at the Kvanefjeld deposit (Image: GME)

The amendment allows the Bureau of Minerals and Petroleum (BMP) to approve that comprehensive feasibility studies can be undertaken on mineral projects that include radioactive elements as exploitable minerals. Within this framework, projects are considered on a case-by-case basis at the government's discretion. GME has lodged an application under these new regulations that has been approved by the BMP.

In a statement, GME said, "This critical development now provides a clear framework for the company's Kvanefjeld multi-element project to proceed to development via the completion of a definitive feasibility study (bankable) conducted in close cooperation with the Greenland government and stakeholder groups."

The company says that it is now in a position to commit to commence definitive feasibility studies in 2011 as planned. The studies, it said, will generate the necessary information to determine development parameters for Kvanefjeld. The Greenland government has stressed that although radioactive elements may now be surveyed, their extraction is still not permitted.

Ove Karl Berthelsen, Greenland's minister for industry and raw materials, announced in late June a comprehensive review process into the exploration and exploitation of radioactive materials. The review process involves the generation of comprehensive information by groups including the Geological Survey of Denmark and Greenland (GEUS), the National Environmental Institute of Denmark (NERI), the Risø National Laboratory, and the Ray Hygienic Institute.

The near-surface deposit has 4.9 million tonnes of rare earth elements (REE) plus yttrium at 1.07%, 0.99 million tonnes of zinc at 0.22%, and 108,700 tonnes of uranium at 0.024%, all JORC-compliant and 79% as indicated resources.

Significant metallurgical work is needed on REE to improve recoveries. The REE are 14% heavy rare earths, which the company says are in high demand. Production is envisaged as 3300 tonnes of uranium per year and over 40,000 tonnes per annum of REE, starting in 2015, making it the largest REE producer outside China. The mine would be a massive boost to economic independence for Greenland.

Rod McIllree, managing director of GME, Commented: "This critical development has resulted from the government's recognition of the unique potential of the Kvanefjeld project, and the opportunity it represents to Greenland." He added, "Significantly, what we believe to be the world's most strategically important mineral projects can now move through the next phase of development. This confirms that the government of Greenland is committed to working with companies to develop a strong and well-regulated minerals industry in Greenland."

The Kvanefjeld deposit is eight kilometres inland from the coastal town of Narsaq, near the southern tip of the country. It has a deep water port. Uranium comprises about 20% of the value of minerals able to be produced from Kvanefjeld.